Knowledge Centre

In-Situ Slum Redevelopment under PMAY



The unparalleled growth of slums in urban centres reflects both on the poor housing conditions of a large section of the society and the massive shortfall of affordable homes near economic clusters. Lack of developable land parcels in city centres is one of the significant challenges towards the development of such homes in metros. In order to address all housing associated concerns, the government included a plan to develop existing slums ‘in situ’ in PMAY, implying on the same land. The approach aims at leveraging the potential of land parcels locked under slums to provide formal urban settlements to slum dwellers by using land as a resource with private participation.


Salient features of slum rehabilitation under PMAY


  • The State or Union Territory (UT) government will have the power to provide additional Floor Space Index (FSI) or Transferable Development Rights (TDR) to attract private participation in slum redevelopment projects.
  • The central government will offer a slum rehabilitation grant averaging at Rs 1 lakh per house. The State/UT government will have the flexibility to utilise these funds for the development of any other slum under private participation, except those being developed on private land.
  • The State/UT government cannot employ Central assistance for projects where it offers addition FSI/TDR.
  • The State/UT government will have the option to allot the constructed homes on ownership rights or on renewable, mortgageable and inheritable leasehold rights.
  • Private partners for the scheme will be selected through an open bidding process. Developers will have to provide transit or temporary accommodation to the slum dwellers for the construction period.


Approach towards slum redevelopment


  • The authorities will first analyse all tenable slums [as identified by Housing for All Plan of Action (HFAPoA)] with respect to their location, the number of eligible slum dwellers, land area under consideration, valuation as per ready reckoner rates, available FSI and density norms.
  • Based on the analysis, implementation authorities would decide whether the slum should be redeveloped with private participation. If required, the State/UT governments would provide additional FSI/TDR to make projects more financially viable. The government may also relax density norms and allow mixed usage of land.
  • The State/ULB may club development of nearby slums to make the projects more financially and technically feasible. Such cluster development could be treated as a single project.
  • A viable project would be developed with two components – ‘Slum rehabilitation component’ and ‘free sale component’. Under the former, eligible slum dwellers would be provided with housing along with basic civic infrastructure, whereas, under the latter, the developer could sell a few units to cross fund the project.
  • The implementation authorities would hand over only the amount of land sufficient to develop housing for all eligible slum dwellers and the free sale component. Any surplus land from a slum area could be used to develop another slum or provide housing for other urban poor.
  • The planning authorities would seek the consent of slum dwellers for designing of the 'slum rehabilitation component.
  • The sale of units under ‘free sale component’ would be linked to the completion and transfer of slum rehabilitation component to implementing agency/State.
  • The implementing authority/State would allot the housing units to eligible contenders via a transparent process. Families with physically disabled members and senior citizens would be given priority in allotment of ground or lower floors.
  • During the process of open bidding, the developer who offers the highest positive premium, while satisfactorily meeting other requirements, would be selected. In case of negative premium, the bidder offering lowest negative premium would be chosen.




Coffers for the development of the project would arise from the slum rehabilitation grant of Central Government or funds sanctioned by State/ULBs or even the positive premium received from other projects. The implementation authorities would have a single account to hold the reserves from all sources. Such accounts could be opened city-wise.


Strategy for Slum Redevelopment 





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